GM, UAW pledge to ‘work together’ on contract talks

July 27, 2011 http://detnews.com/article/20110727/AUTO01/107270400

GM, UAW pledge to ‘work together’ on contract talks

CHRISTINA ROGERS
/ The Detroit News

Detroit — General Motors Co. and the United Auto Workers kicked off labor talks today with leadership on both side saying they owe it to the American taxpayers to reach an agreement that keeps the automaker competitive.

“We want to show the world what we can do when we work together,” said GM vice president of labor relations Cathy Clegg.

GM and union leaders began talks with a ceremonial handshake at the automaker’s Detroit-Hamtramck plant, where GM builds the plug-in Chevrolet Volt. They acknowledged a complicated set of talks ahead, but say it is crucial they forge a contract that keeps them competitive with their foreign rivals in the South.

UAW President Bob King reiterated his pledge to organize the transplant factories, which generally have lower labor costs, and level the competitive playing field for Detroit’s Big Three. “We’re proving that labor and management, government and the community can work together.”

Contract talks come at a pivotal time for General Motors Co., which after collapsing into bankruptcy two years ago, is beginning to regain some of its former strength.

The Detroit-based automaker posted a $4.7 billion profit last year and another $3.2 billion in the first-quarter. GM will announce second-quarter results Aug. 4.

But GM, like its crosstown rivals, must try to hold the line on labor costs or risk undoing gains made two years ago during its painful bankruptcy restructuring in 2009.

Both GM and the union have said they’re open to richer profit-sharing checks as an alterative to base pay increases.

The UAW’s four-year contract with Detroit’s Big Three automakers expires Sept. 14.

Chrysler Group LLC formally kicked off contract talks with the UAW Monday; Ford will have its ceremonial handshake with union leaders Friday.

Both Chrysler and Ford reported second-quarters earnings results this week. Ford beat expectations with a $2.4 billion profit, while Chrysler recorded a $370 million loss after repaying U.S. and Canadian government loans. Excluding that one-time debt repayment charge, Chrysler reported an adjusted net profit of $181 million.

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